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Friday, 30 May 2014

5 tips for buying car insurance for the self-employed of dyman associates insurance group of companies

Here are five coverage tips to make sure you have the
protection you need:

1. Don't
lie to the car insurance company.

A personal car insurance policy typically excludes
coverage for some types of business use, other than commuting to an office, so
you need to check the policy and let your insurer know how you're using the
vehicle.

"Otherwise the insurance company could deny a
claim and then cancel your policy if you rely strictly on a personal auto
insurance policy and use your vehicle for business purposes," says Insure.com
consumer analyst Penny Gusner.

That goes for part-time businesses, too, says James
Kuryak, principal of Niagara National Insurance in Buffalo, N.Y.

In his region, for instance, a lot of folks make extra
money in the winter by attaching plows to their pickups to clear private roads.
Generally vehicles with equipment attached to them require commercial
insurance.

A business-use endorsement is an addition to a personal
car insurance policy. It's geared toward professionals such as real estate
agents, lawyers or consultants who drive frequently for business, but aren't
using a car in ways that a personal policy would exclude. Adding the
endorsement boosts the premium, but a personal policy with a business use
endorsement is still usually less expensive than a commercial car insurance
policy.

"A business-use endorsement is just so you and the
carrier understand each other that this vehicle is used for business
purposes," Kuryak says.

In some instances you may not need additional coverage.
Say, for instance, you're a self-employed writer and drive occasionally to your
literary agent's office. In that case a personal policy likely would suffice,
and a business-use endorsement would not be necessary, Kuryak says.

But if you drive frequently for business, the insurer
may require the endorsement or have you upgrade to a commercial policy.

The choice will vary according to your circumstances
and the insurer. A business-use endorsement on a personal policy may be
sufficient if you're a sole proprietor, use only one vehicle for the business
and you can purchase high enough coverage limits to protect you and the
business, Gusner says.

3. Understand when a commercial policy is a must.

Some vehicles and uses are disqualified for personal
auto insurance, and you have to buy a commercial car insurance policy to have
coverage.

"You're not going to get a dump truck on a
personal policy," Kuryak says.

You might even have a hard time getting a pickup or van
used for business on a personal policy.

Say, for instance, a self-employed handyman uses one
vehicle, with no equipment attached, to drive to homes to bid on projects.

"If he is using a car, a personal policy may be
all he needs," Kuryak says.

But if he's using a pickup or van, the insurance
carrier might require a business-use endorsement or might not issue a personal
policy on the vehicle based on the customer's occupation as a self-employed
contractor. The insurer will assume the vehicle is used heavily for business
purposes.

"Also, will the contractor have signage or a wrap
on the vehicle advertising his service? That just screams business use,"
Kuryak says. "To be safe, the contractor should indicate business use to
their personal lines carrier and see if they will accept the risk. If so, all
is good. If not, then purchasing a business policy would be needed."

The guidelines of whether you need a commercial policy
vary by insurer. Esurance, the direct-to-consumer insurer owned by Allstate,
says you likely need commercial car insurance if the vehicle is:

§Used to deliver goods or used as a taxi or messenger
service.

§Owned or leased by a partnership or corporation.

§Registered or titled to a business, corporation or
partnership.

§Driven by employees or non-listed drivers.

§Leased or rented to others.

§A pickup, van or utility vehicle that weighs more than
10,000 pounds or has a rated load capacity of more than 2,000 pounds.

§Equipped with snowplowing or cooking equipment,
bathrooms, altered suspensions, hydraulic lifts or racing equipment; or has
equipment installed, such as ladder racks or permanent toolboxes used for the
business.

4. Determine how much liability and other coverage you
need.

Work closely with your agent or insurer
to determine how much liability insurance you need. With a personal
auto insurance policy, $500,000 is usually the highest liability limit you can
buy, without purchasing an additional umbrella policy. A commercial policy
offers liability limits in the millions. After all, you have a valuable
business to protect if you cause an accident and someone sues you.

Commercial insurance also offers other types of
coverage that you can't get with a personal auto insurance policy. Rental
reimbursement with downtime coverage for trucks, for instance, helps cover
rental fees and other costs when your truck is inoperable after an accident. A single-deductible
endorsement lets you pay a single deductible if both your vehicle and attached
equipment or trailers are damaged in an accident. Many other options are
available.

Because businesses are so varied, commercial insurance
is more complex than personal auto insurance. Talk to an insurance agent or
company representative to determine what you need.

5. Expect to spend more for commercial coverage.

Commercial insurance generally costs more than personal
auto insurance because it's designed to cover greater risks and provide more
protection.

A variety of factors affect the premium including:

§Where the vehicle is garaged

§Driving record of you and other employees who use the
vehicle

§Type of vehicle

§How the vehicle is used

§Deductible - the higher the deductible, the lower the
premium.

If it's a close call between a personal policy with a
business-use endorsement and a commercial policy, Kuryak says to imagine how
you'd feel if you caused a bad accident and had to make a claim. He chose a
commercial policy on the vehicle he uses for his independent insurance agency.

"I have it because I'm constantly in my car
working," he says. "I sleep easier knowing a claim is going to go
through my business policy first."